There are plenty of dividend stocks that offer high yields, but those generous payouts often come with big risks. What you want is a high-yield stock that can sustain its dividend under a wide range of scenarios. A fat dividend yield doesn't mean much if an eventual dividend cut sends the stock plummeting, more than erasing all that dividend income.
My two favorite dividend stocks, both of which I own, are International Business Machines (NYSE:IBM) and General Motors (NYSE:GM). These stocks have been knocked down by pessimism, pushing the dividend yields above 4% in each case. And those high-yield dividends are well covered by earnings, meaning that the chance of a dividend cut is slim. Here's why dividend investors should consider adding IBM and GM to their portfolios.
Source: Motley Fool
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